Thursday, June 01, 2006

New England Journal of Medicine's take on Medicare Part D and Benefit Limits

This week's issue of the New England Journal of Medicine includes several articles on the new Medicare Part D prescription drug program, a point - counterpoint by the CMS Director Mark McClellan and Rep. Louise Slaughter (D NY) and a special study concluding that the Medicare Part D coverage donut hole kills (a bit of an exaggeration but all of these articles are freely available).

The Journal editorializes about this study in pertinent part as follows:

"The use of increased copayments or limitations on benefits in an attempt to control spending represents a misdiagnosis of what accounts for, and what is needed to address, the high and rising costs of health care. Any approach to creating better outcomes in health care must address the appropriate clinical treatment of chronically ill patients. Interventions to contain costs also need to address the rise in the prevalence of treated disease. A large component of the rise in health care spending is the increase in the rates of diabetes, back problems, and mental disorders associated with the persistent rise in obesity across virtually all age groups. Thus, controlling health care spending will require a strategy for the more effective treatment of chronically ill patients and for the slowing or halting of the increase in the prevalence of diseases such as diabetes.

"Instead of an approach driven by the redesign of insurance and benefits, control of spending will require the early identification of patients at risk and the appropriate payment of physicians to manage a patient's multiple chronic diseases according to evidence-based protocols. Providing better care for chronically ill patients under the Medicare program will require changes in policy. One approach would accelerate the use of the models of payment and delivery of care for chronic diseases that are under way in Medicare. A key unresolved issue concerning such an approach is how to get physicians to apply integrated models of chronic-disease care and how to get their patients to participate actively.

"The results of the study by Hsu et al. should encourage movement toward other approaches to the management of spending in Medicare and other health insurance programs. One such approach would involve a monthly payment to physicians so that they would take the time needed to work with patients and manage their multiple chronic illnesses. Simultaneously, cost sharing for clinically recommended care (e.g., annual eye examinations or measurement of glycated hemoglobin for patients with diabetes) should be waived to ensure higher rates of compliance. Indeed, a condition-specific cost-sharing structure should be in place for clinically recommended services for chronically ill patients. We should be reducing the barriers to treatment and encouraging patients to take appropriate medications for the recommended duration, rather than increasing these barriers by limiting benefits. As the findings of Hsu et al. highlight, the use of cost sharing and limits on prescription-drug benefits to control spending is counterproductive both medically and in the immediate attempt to limit spending.

"Effective strategies for reducing the level and growth of spending will need to rely on tools other than high-deductible plans and limits on benefits. With respect to the rise in spending, we need to address the rise in obesity head-on. Doing so will be neither easy nor likely to produce immediate results. However, the failure to include primary prevention and population-based approaches in the cost-containment tool kit will come at a price: a continued increase in obesity and in the prevalence of associated disease. "

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